The “Hyper-meritocracy” – an Oxymoron Led by Criminals

Posted by on October 8, 2013 in Economy with 0 Comments
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By William K. Black (NewEconomicPerspectives.org)

(Editor’s note: In this essay, Black discusses Tyler Cowens’ book Average is Over: Powering America Beyond the Age of the Great Stagnation [Dutton/Penguin])

I write to challenge [Tyler] Cowen’s assumption that winners will prevail through a process of “hyper-meritocracy.”  Cowen’s embrace of Social Darwinism assumes that the winners have a selective advantage that arises from “merit” – which Cowen conflates with the ability to create wealth.  This is passing strange as we are still suffering from an orgy of wealth destruction led by the “winners.”  The people who grew wealthiest were often the people must responsible for the largest destruction of wealth in history.  In this first column I show that it is the most anti-meritocratic system.  We do not live in a “winner-take-all” Nation.  We increasingly live in a “cheater-take-all” system.


The constants present in each of our three modern financial crises (the S&L debacle, the Enron-era scandals, and the mortgage fraud crisis) were that the crises were driven by epidemics of accounting control fraud and that during the expansion phase of each crisis neo-classical economists praised the worst frauds as brilliant innovators who understood the importance of technological advances.  The economists assured us that the massive compensation that the fraudulent CEOs awarded themselves was the just result of an emerging meritocracy.  The reality was the opposite.

Finance has become dominated by the worst of us, which is why we have recurrent, intensifying financial crises driven by their fraud epidemics.  Cowen looks at the results of our hyper-anti-meritocracy system of finance, a gaudy whorehouse bedecked with red neon lights. Without even discussing fraud or why the people who are the leading destroyers of wealth were the largest beneficiaries and experienced the greatest growth in wealth since 2009 Cowen describes finance as if it were a temple of meritocracy.

Read more:  The “Hyper-meritocracy” – an Oxymoron Led by Criminals

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